Michael Gerson: Democrats are playing with dynamite

Gov. Scott Walker’s decisive victory in Wisconsin admits to a number of plausible explanations: a rejection of overreach in the use of recall elections, a repudiation of thuggish campaign tactics, a test of turnout techniques, a demonstration of post-Citizens United campaign funding realities.

But one thing the outcome was not: a binary, left-right choice on the role of government.

In Wisconsin — which has not voted for a Republican presidential candidate since Ronald Reagan — a simple ideological choice would have been more favorable to Walker’s Democratic challenger, Tom Barrett. The voters of the Badger State do not object to the idea of an activist, generous state government. The problem for Democrats in Wisconsin and elsewhere is that state and local budget debates unite conservatives while dividing voters who believe in active government.

One portion of the progressive coalition — public-sector unions — used the good economic times of the 1990s and 2000s to lock in generous health and pension benefits at the state and local level through collective bargaining. Politicians favorable to those unions enjoyed reliable political support. But the Great Recession dried up revenues, making health and pension commitments unsustainable, forcing some states into fiscal crisis and some cities toward bankruptcy, and threatening the provision of public services.

Other members of the progressive coalition value public services highly -- parks, libraries, public safety, education, support for the homeless and such. They are joined by civic-minded independents and non-libertarian conservatives. These voters have seen the commitments made to public-sector unions devouring state and local budgets, leaving little room for any initiatives in the public good.

The Pew Center on the States has quantified the problem. In 2008, states had set aside $2.35 trillion to pay for public employees’ retirement benefits while owing $3.35 trillion in promises — a difference of $1 trillion. A year later, the gap had grown by 26 percent. This massive, expanding obligation cuts into the provision of government services.

The zero-sum choice between public pensions and public services is even more evident on the local level. In California cities where unions have been successful in securing advantages, the fiscal crisis is acute. The growth of salaries, health benefits and pensions has far outpaced the growth of revenues. Payments by the city of San Jose, Calif., to its public retirement fund have gone from $73 million in 2001 to $245 million this year — crowding out spending on libraries and public safety. On Tuesday, 71 percent of San Jose voters approved a measure to cut retirement benefits for city workers. San Diego voters took similar action. Los Angeles is headed toward its own budget showdown. “A lot of things are going to happen dramatically over the next couple of years, and then people will listen,” says former LA Mayor Richard Riordan. “If you close down all the parks and all the libraries, this is political dynamite.”

By siding with public employees in the state and local budget disputes, the national Democratic Party is playing with dynamite. Voters are sometimes willing to accept new taxes to purchase shared public benefits such as roads or schools. But even in liberal California cities, voters are reluctant to raise tax revenues to transfer directly to the retirement benefits of a middle-class interest group. So public-sector unions seek to channel resources away from education, parks and libraries into pensions — making public unions a major obstacle to the adequate provision of public services. This is a losing political proposition in Wisconsin, California or just about anywhere else in the country.

In flush economic times, public workers’ unions and progressive advocates of spending get along just fine. There is plenty of money to go around for both the system and the services. In lean times, however, the interests of union Democrats and progressive Democrats have diverged, forcing politicians to choose. In Wisconsin, Barrett took the side of the system, struggling to defend its prerogatives. San Jose’s Democratic Mayor Chuck Reed, in contrast, took the side of the services and pushed for pension reform. Both are progressives. Only one was pursuing the common good.

At stake is the proper role of government itself. Does it exist primarily to serve the public and the needy, or to serve those who serve in government? The question is not easy for Democrats, who have traditionally straddled both priorities. But a choice between them is increasingly unavoidable.